French court upholds fracking ban

10/11/2013

French court upholds fracking ban

BY TARA PATEL and GREGORY VISCUSI

PARIS (Bloomberg) -- France’s constitutional court upheld a ban on hydraulic fracturing, ruling that the law against the energy-exploration technique known as fracking is a valid means of protecting the environment.

The 2011 law “conforms to the constitution” and is not “disproportionate,” the court in Paris said in a decision posted on its website today.

Schuepbach Energy LLC, a Dallas-based explorer, complained to the court that the law was unfair after having two exploration permits revoked because of the ban. President Francois Hollande has said France won’t allow exploration of shale energy even as the country seeks to reduce its reliance on nuclear energy and keep down costs for consumers.

“It’s a judicial victory but also an environmental and political victory,” French Environment Minister Philippe Martin said today after the ruling. “With this decision the ban on hydraulic fracturing is absolute.”

Schuepbach argued in court last month that there isn’t a study that establishes risks from fracking. The explorer also said the ban was unfair because the drilling technique may still be used in French geothermal-energy projects.

The court today ruled that in imposing the ban, lawmakers were pursuing a legitimate goal in the general interest of protecting the environment and noted differences between geothermal and shalegas exploration techniques. The court also rejected an argument that the ban went against property rights.

“France is depriving itself of exploration that could evaluate potentially large nonconventional carbon resources,” the GEP-AFTP oil and gas lobby said in a statement, adding that it “deplores” the court decision. France should create a commission to experiment with shale drilling in order to evaluate the size of reserves, the lobby said.

France and Poland have the greatest potential for recoverable shale gas in Europe, the International Energy Agency has said. In the U.S., where fracking is widely used, oil output is poised to surpass Saudi Arabia’s by 2020, making the country almost self-reliant, according to the IEA.

France banned fracking and canceled exploration licenses held by companies including Schuepbach and Total SA, the country’s biggest oil company, after protests by environmental groups. The ban has proved divisive, pitting Industry Minister Arnaud Montebourg, who backs drilling as a way to create jobs, against Martin as well as Delphine Batho, whose job Martin took.

The ban can no longer be attacked in court and will benefit the fight against carbon emissions from the burning of fossil fuels, he said.

“Beyond the question of fracking, shale gas is a carbon emitter,” he said. “We must set our priorities on renewable energies.”